Macroeconomic Forecast Ukraine

July 2008 | Macroeconomic Forecasts

We have revised our long-term forecasts for Ukrainian gross external debt on the back of a 9.4% q-o-q increase in the first quarter to a record US$92.5bn. Gross external debt is now forecast to hit US$114.1bn by end-year, spiralling further to US$130.1bn a year later. While we expect total foreign debt stock to rise through our five year forecast period, eventually hitting US$159.1bn in 2012, we stress that the growth trend is likely to remain negative. Indeed, expansion of gross external debt is expected to slow to 14.0% in 2009 from a forecast 35.0% in 2008, largely on the back of an expected tightening of credit conditions beginning in the latter half of this year. This will translate into a reduction in percentage of GDP terms from a peak of 73.6% in 2008 to 53.1% at end-2012.

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